US Treasury to track cash buyers of prime real estate … The US Treasury has launched a test programme to track all-cash buyers of high-end real estate in New York and Miami, amid fears that the US property market has become a favoured destination for foreigners looking to launder ill-gotten assets. – Financial Times

Dominant Social Theme: To stay on top of criminality demands savvy detective work and enhanced anti-cash legislation.

Free-Market Analysis: The federal government is at it again, demanding that private industry compromise the privacy of clients because the state is wary of possibility of criminal acts.

Here's how the Financial Times puts it:

The Treasury issued orders on Wednesday requiring US title insurance companies in Miami and Manhattan to identify the "natural persons" behind shell companies used to buy high-end real estate in many all-cash transactions. The temporary order, which will take effect March 1 and run for 180 days, is designed to gather data ahead of a possible more permanent rule change.

The article quotes Heather Lowe, legal counsel for Global Financial Integrity, as saying that title insurance companies probably do NOT have all the information necessary in all cases. She is willing to put the best face on the Treasury order, however, intrusive as it is, explaining it is likely an exercise in trying to find out just how much "ill-gotten money" was flowing into US real estate.

"What I think they are probably looking for is if there's a dip in the market. Do the numbers rise some place else? What is the effect of putting this level of transparency in place," she said. "They'll probably use that data to see if there is a problem and a legitimate case for regulation."

Terrence Oved, a New York real estate attorney, is quoted in the article as saying that the Treasury's actions would lead to more permanent disclosure requirements, a situation he characterized as "disruptive."

The threshold of $3m for transactions in Manhattan was relatively low and meant many ordinary buyers would get caught up in the net, he said. The rules would also unfairly target people such as movie stars and professional athletes who used LLCs to shield their identity for privacy reasons.

In an article entitled, "The International War on Cash," Thomas makes the argument that governments around the world are targeting cash transactions simply because they cannot be easily controlled rather than because of suspicions of rampant criminality.

Here's how the article begins:

Back in 2008, I began warning of increasing capital controls that we would see in the future, as a component in the decline of Western economies (Western in the broad sense, including Japan, Australia, etc.) Along the way, it occurred to me that, at some point, governments might collectively attempt to eliminate paper currency in favour of an electronic currency – transferred from party to party solely through licensed banks.

Sound farfetched? Well, maybe, but what if the U.S. and EU agreed on an overall plan, then suggested it to other governments? On the face of it, this smacks of conspiracy theory, yet certainly, all governments would benefit from this control and would be likely to get on board. In fact, it might prove to be the only way out of their present economic problems.

When I first wrote on the subject, there was considerable criticism as to the possibility that such a programme would ever be attempted, let alone succeed. And, granted, it was so Orwellian that it was understandably seen as a crackpot idea. But since that time, the programme has been developing extremely rapidly. In the last six months alone, it has become so visible that it has even garnered a name – "the War on Cash".

Thomas provides us with updates on this "war," explaining that what he calls Phase I is underway. He cites actions in such countries as France, where limits have been lowered on how much cash can be transferred without reporting, and Sweden, which has begun treating "all cash transactions as suspicious."

Thomas explains how a Phase II might work as well.

Phase II will be the second wave of measures and they will be more draconian than Phase I: Create a definitive false flag event that demonstrates how physical cash is the primary means of funding evil acts in the world; Declare a date on which paper currency will become illegal (Until that date, it can be deposited into a bank. After that date, it becomes criminal to possess it.); Once all cash has been deposited in banks, increase negative interest rates; Confiscation of deposits can then be implemented, as desired, by banks …

Thomas makes other speculations, writing that at some point taxation will be by "direct debit" and money will be declared the property of the issuing state. This would allow the state to legally freeze or confiscate bank accounts at will.

How will the results of this war be received? Some savers will accept the outcomes, he believes, but others will seek alternatives to maintain as much privacy as possible.

Thomas offers some potential solutions to the latter group. He writes that an international war on cash will not necessarily yield global outcomes. Just as there are individuals that will resist government plans, so there will be some jurisdictions that will do so.

Those who want to anticipate the results of the war on cash and position their wealth in ways that will remain secure from confiscation ought to begin to seek out such jurisdictions now, Thomas advises.

One needs to locate jurisdictions that have historically been resistant to the plans of the great powers and have tended to endorse forms of limited government, he explains.

One then needs to transfer assets to these jurisdictions and also begin to convert assets into forms of wealth that are harder for governments to confiscate. These might include precious metals, gemstones and real estate. Thomas also advises that one create a plan for a quick getaway in case one is necessary.

After Thoughts

It is very difficult for many people to internalize what's going on in the world today. These people may eventually find their affairs a good deal more compromised than those who make the hard choices now.

Confiscation and cashless societies make crooks out of all of us. It is the last flagrant attempt of the government to cover their useless tail-ends for the overspending, thoughtless, mind boggling greed and stupidity that they have committed and will continue to commit. People are starting to demand that government care for them instead of demanding it work for them thus creating the atmosphere of greed on both sides.

The passive who accept this demand not only sell their financial freedom but receive relativity nothing in services except supervision by the DEA, IRS and the Justice Department. This new government policy has conveniently created in-house tattle-tales across all forms of businesses such as your 18 year old bank teller, your 20 year old pharmacist, your Doctor and every other service provider.. This is going to expand. Fool’s gold is now in play. So is spying and squealing on your neighbor.

tom hewitt

Electronic money and a cashless society are GOOD! It means that the implosion of the parasite nation/state is accelerating. Fiat money, whether paper or enpixelated, is a creation of the nation/state and restricting supposedly free economic activity to government-monitored computer accounts won’t be embraced by a large portion of the population, albeit mostly the old-timers. The generation currently in charge seems perfectly willing to accept the trend as long as their gadgets produce digital photos of their friend’s parties, the latest lame music and the GPS coordinates of the most chic restaurants. But even some of these yuppies will have the intelligence to discern that the capability of banks and the government to raid their savings might outweigh the convenience of carrying around a magic phone that can be used to buy almost anything. Things gotta get worse before they get better.

Jack Perry

Hmmm…here in Tucson, there’s a lot of hand-made signs on utility poles that say: “Cash paid for houses, any condition, call…” and the phone number. I think what’s going on is a cash real estate economy and the government is wetting its pants because it can’t “regulate” i.e. assess taxes and fees and let their banker buddies help themselves to a fee or two. People are bypassing banks and real estate companies and dealing face-to-face selling and buying houses in cash. The financial sector probably went whining to the government and the government, always suspicious, thinks something illegal is going on. But the truth is, people just got tired of dealing with the polo shirt-and-slacks crowd that make the simple act of buying a house into something like building a lunar lander.

Bruce C.

True, but realize that in real estate (and most businesses) a “cash” purchase doesn’t necessarily mean physical currency was transacted. It simply means that a cash equivalent is exchanged, be it a “cashier’s” or “certified” bank check –
or physical coins and/or bills. The bottom line is that there is no delay in payment, as can arise when financing a purchase.

Injun Holbrook

Bruce C. Yes and a lot of it is hard money that comes from various sources. Even I dabble in hard money loans for our portfolio and its helped a lot of people both buyers and sellers. The only difference between bank (institutional) funds and ours is the speed of the transactions. A bank takes time and we can loan and close within a couple of hours if need be. It’s all transactional, simply quicker albeit much more expensive. Banks are starting to do the same thing not because its so lucrative but the public demands quicker electronic decisions.

Bruce C.

Come to think of it, as of about 10 years ago banks have put a hold even on “certified” checks from other banks making them no different than personal checks which defeats their purchase of being cash equivalents. Nevertheless, RE brokers and attorneys still consider them as good as cash but they’re really not in that they aren’t be honored immediately.

Mack

You are correct Bruce. I do not know of a title company that will accept cash as a form of payment. Paid in cash just means that a bank does not get to appraise it…and theoretically the buyer cannot back out.

Tom

As I wrote in so many real estate sales contracts over the years, “Cash at time of closing via cash, cashier’s check or proceeds of a new first loan, which buyer will apply for, pay the customary costs of, and obtain by date of closing.”

Mack

Nevertheless, cash at a title company above $150 will not be accepted.

Praetor

“ill gotten money”. The biggest perpetrator of “ill-gotten money” banks, governments, and the institutions built around these illegitimate organizations. The more they wright rules and regulations to control the activities of the human population, the more the alternative markets will increase. Call them what you will, ‘ black, gray or underground’ markets, these market will one day surpass the so called legitimate markets in value. When command and control fails, because it is run by uneducated imbeciles, who’s only purpose is steal other peoples money, the people will fined ways around such a system. Estimates of the world underground economy, 10 to 12 trillion and growing! This is Natural Law and Human Action in motion. If these fools wish to eliminate cash, all they have to do is stop ‘PRINTING’ it. They are the ones who created this system of thievery. May I say, I don’t think people like having their stuff stolen. Hear is a new saying for ya, ‘all good thieves are dead thieves’!!!

Bruce C.

Unfortunately, I don’t think a “war on cash” is far fetched at all. I’m frankly surprised it didn’t start a good ten years ago. I hope something stops this though.

Just a few days ago I was going over my financial statements with my accountant and he noticed that I had a bank account called “Safety Deposit Box”. “So you have cash?,” he asked. “Yes,” I answered. “Hmm…the IRS doesn’t like that,” he warned, “better call it something else.”

It will be interesting to see how things play out. Unfortunately most people don’t have much money (supposedly about half the US population doesn’t have even $1,000 handy) and so they may not care about such things – at first – especially if cash is not outright outlawed or if cash transactions are made reportable only over a certain amount. Many may think that doesn’t apply to them if the reportability limit is high enough. They might also envy those who have a lot of cash or might believe they must have obtained it illegally and/or tax-free and thus “deserve” to be “caught.” I can see the same sick attitudes arising if/when PMs become more valuable.

Here in Miami there is a lot of cash around for various reasons (foreigners don’t trust banks, some wages are paid in cash, drug dealing, savings, tax avoidance, “undocumented” workers’ pay, income from side jobs, grey/black markets, etc.) Cash is often paid for new houses, but the reason most customers say they do that is to get the best price on the construction. In my experience I’ve never had evidence that any cash I’ve received was “ill gotten.” On the other hand, a lot of young people are nearly totally given over to doing things electronically and so see cash as a nuisance. (But, fortunately, a relative and his friends who work in the food service industry practically revolted when they learned that the restaurants they worked in were going to demand all of their cash tips be handed in to management so as to be added to their paychecks. The restaurants backed down.)

It’s really disgusting and scary, and it is definitely about control, maximizing tax revenue, and maybe even confiscation through negative interest rates or bail-ins. The later attempts will be futile, however, because there really isn’t very much physical cash currency in circulation relative to the total money/credit supply. There’s only about $1 trillion in US currency in the world and most of it isn’t even in the US (maybe $350 billion), and yet there is about $55 trillion in total electronic deposits plus credit. An extra trillion is not nearly enough to save the Titanic. And, speaking of US cash held overseas, I wonder how that will be dealt with?

Injun Holbrook

Bruce C.-good point
Since the U.S. is the world’s largest offshore tax haven, foreign currency will always invest in the U.S. and especially regions like yours. While the U.S. taxpayer is strapped with FACTA requirements, the U.S. government provides foreign nationals various tax free investments and deposits, but more importantly, does not report the foreign national’s tax information to their home government.

Shark-Proof

I don’t see how it will be possible to force the less developed countries to move to electronic currency. If the majority of merchants do not have access to 24 hours of electricity, how can they accept cards?

Injun Holbrook

Hi Shark-Proof-excellent question.
I travel extensively throughout Asia and maintain a part-time residence in that area. It is the less developed countries that are leading the charge into a cashless society for the exact reasons you mention and more. When I travel to the less developed countries that do not have the infrastructure, there is one item you see that everyone has. It is a cellphone. Mostly to text with. Talk is too expensive.

Since most have very little money, they have established a micro digital payment, deposit and basically cashless system that cannot be ignored by the establishment. It is the future of banking. It is the future of us all. There are already over a billion people using this system and very effectively. It not only will change the way we bank in the western world but it pressures the credit cards to adapt and change or become obsolete also.

I have been in the rice paddies with 80 year old farmers who for the most part have not seen a white man much less this American Indian boy and watch them buy and pay for, plantings, weather reports, commodity prices and lock in their harvest prices all by the use of their phone, it is the future of banking. It is the future of us. I hope this helps with your question.

Clearly this is where the USA will go and soon. No cash, all electronic cash. It won;t take a false flag to do it, just another economic crisis which happen fairly regularly now. And they propose the necessity of being able to monitor and adjust the currency; by that they mean monitor (surveill all transactions) and create (instant inflation) and seize (give accounts across the board haircuts). Amazingly the ruling and enforcing class won’t be effected by this mechanism either because their assets literally won’t be effected or in the case of hired enforcers, positive cost of living adjustments.

And the irony of electronic cash is that it ALL fails when the power goes off.

Keep stacking those precious metal coins! They make nice “trinkets” for barter.

Demonocracy

The self-proclaimed terrorist fighters want to track your money in amounts of chicken feed but they didn’t seem to mind that Pakistani’s ISI chief wired $100,000 to Mohammad Atta the ring leader of the 9-11 attacks and when it was addressed the 9-11 commission said it was irrelevant and it didn’t matter where the money came from to finance the attacks or who it came from.

“There are many terrorist states in the world, but the United States is unusual in that it is officially committed to international and domestic
terrorism.” ~Noam Chomsky

Tom

Typical US government fools. Sure, there’s LOTS of foreign cash buying US real estate. You can read all about it in the business news: Saudi Arabians and Chinese have been investing heavily in US farm land and west coast top end homes. Ill-gotten money? US Treasury may have fun investigating the finances of the Saud family, and of Chinese businessmen. Go for it. Knock yourselves out.

HM

Both Wachovia and the Hong Kong & Shanghai Bank have been found guilty in recent years of laundering hundreds of billions of dollars in narco money. They paid fines and no person was tried, much less went to jail. Yet, the US government has the gall to criminalize every Mom & Pop with a little cash in the cookie jar! They see “us” as the enemy.

Dave

Sooner or later the trusting idiots are going to find out that Lucifer is not really their friend.

Robert

Slaves (US subjects) are not allowed to have cash for many illegitimate reasons. The government can’t steal what they can’t see and they want it all, A political prisoner or anyone else can not run nor hide without cash or liquid assets, The Fascist surveillance state wants total economic control, The banking cartel and central bank criminals know the fiat money game is over so they want a cashless, numbers in a computer system. One episode of “Hunted” will tell you all you need to know, it’s about control of everyday people everywhere. Your papers are not in order and your assets have been frozen, you will be reduced to life on your knees instantly. Commodity money defeats them gold , silver, copper, wheat, gasoline, bullets, tin; anything but paper and central bank Cartels.

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